Elgin Platform Gas Leak – Financial Implications

Press Release
Wednesday, April 11, 2012
Elgin Field Platform: Photo credit: Total

Patrick de la Chevardiere, Total CFO, explains financial implications of the Elgin Platform gas leak problem

Excerpts from the speech follow:

"From an environmental standpoint, it is important to understand that Elgin is a natural gas and condensate field. It is not an oil field. While we understand the comparisons to Macondo are inevitable, we would like to state clearly that the situations are very different. There is no crude oil involved here, and therefore the current impact on and risks for the environment are relatively low.

Let me now give you our current best estimate of the financial implication of the Elgin situation. Following this incident, we have shut down the Elgin field together with the adjacent Franklin field.

To give you a sense of the contribution to our production of these fields, Elgin-Franklin produced about 130 kboe/d of production in 2011, and Total's net share based on our 46.2% interest was about 60 kboe/d. Our budget included estimated Elgin-Franklin production of 53 kboe/d net into Total for 2012. This is about 2% of our total production.

In terms of lost earnings, we estimate that the shut-in production represents a negative impact of about $1.5 million per day at the net operating income. In addition, estimated cost of the response and remediation activities currently underway is around $1 million per day for Total, including the costs of the two drilling rigs mobilized for the relief wells.

We have third-party insurance that should provide adequate coverage both for property damage, including the cost of remediation, and for liability, including environmental damage. We appreciate the level of concern in the market, so let me assure you that we believe we have ample resources to deal with this situation. We have a robust liquidity position with $19 billion of cash and cash equivalents on the balance sheet as of the end of 2011, and we also have undrawn committed credit lines for about $10 billion. In addition, we are confident that this event has not impacted our ability to access the capital markets."

Maritime Reporter January 2015 Digital Edition
FREE Maritime Reporter Subscription
Latest Maritime News    rss feeds

People & Company News

Tanzania's Energy Minister Resigns

Tanzania's Energy and Minerals Minister Sospeter Muhongo resigned on Saturday amid a graft scandal that has rocked the gas-rich country and led Western donors to delay aid,

China's COSCO Group Returns to Profit

China Ocean Shipping Group Co (COSCO) returned to profit in 2014 after three years of losses, state media said on Saturday, citing an interview with the group's chairman.

Brent Closes Up, U.S. Crude Down After Saudi King Dies

Brent crude was buoyed on Friday by market uncertainty over the future of Saudi oil output, while U.S. crude fell on more signs of oversupply. Saudi Arabia's new king,

Offshore

Oil Platform Ablaze in the Gulf of Mexico

Fire broke out on an unmanned oil platform in the Gulf of Mexico approximately five miles south of Port Fourchon, La., the Bureau of Safety and Environmental Enforcement (BSEE) reported.

Subsea Crane Takes a Long Journey

Last September the test bed in Rostock was the stage of a single lift of the RL-K 7500 subsea crane. The same crane was then loaded and shipped to the South Korean customer.

Dynamic Positioning & the Potential for USCG Regulations

Dynamic positioning is a vessel capability provided by integration of a variety of individual systems and functions to automatically maintain a vessel’s position

Finance

Oil Majors to Preserve Dividends Despite Oil Collapse

Europe's oil majors will strike a sober note in their fourth-quarter results and investors will focus on companies' plans to maintain cherished dividends and

China's COSCO Group Returns to Profit

China Ocean Shipping Group Co (COSCO) returned to profit in 2014 after three years of losses, state media said on Saturday, citing an interview with the group's chairman.

Brent Closes Up, U.S. Crude Down After Saudi King Dies

Brent crude was buoyed on Friday by market uncertainty over the future of Saudi oil output, while U.S. crude fell on more signs of oversupply. Saudi Arabia's new king,

Environmental

Petrobras Develops Technology to Cut GHG

Petrobras develops a new technology that reduces the emission of gases that cause greenhouse A new technology to reduce the emission of greenhouse gases (GHG)

Oil Platform Ablaze in the Gulf of Mexico

Fire broke out on an unmanned oil platform in the Gulf of Mexico approximately five miles south of Port Fourchon, La., the Bureau of Safety and Environmental Enforcement (BSEE) reported.

Great Lakes Coal Falls Short in 2014

Despite a nearly 1-million ton increase in coal shipments on the Great Lakes in December, the surge was not enough to enable the trade to outperform 2013, the Lake Carriers’ Association (LCA) said,

Casualties

Tanzania's Energy Minister Resigns

Tanzania's Energy and Minerals Minister Sospeter Muhongo resigned on Saturday amid a graft scandal that has rocked the gas-rich country and led Western donors to delay aid,

Collision With lock Gate in Kiel Canal

Delays can be expected in the Kiel Canal following a collision this yesterday, 23 January, with the small north lock gate at Brunsbuettel. Only the big north

Oil Platform Ablaze in the Gulf of Mexico

Fire broke out on an unmanned oil platform in the Gulf of Mexico approximately five miles south of Port Fourchon, La., the Bureau of Safety and Environmental Enforcement (BSEE) reported.

 
 
Maritime Careers / Shipboard Positions Maritime Contracts Navigation Offshore Oil Pipelines Pod Propulsion Port Authority Salvage Ship Electronics Sonar
rss | archive | history | articles | privacy | terms and conditions | contributors | top maritime news | about us | copyright | maritime magazines
maritime security news | shipbuilding news | maritime industry | shipping news | maritime reporting | workboats news | ship design | maritime business

Time taken: 0.2086 sec (5 req/sec)